[Former Bank of Japan Board Member Makoto Sakurai: Bank of Japan May Raise Rates in March if Yen Falls Again] Former Bank of Japan board member Makoto Sakurai stated that if the yen falls again before the expected Japan-US summit in March, the Bank of Japan may raise interest rates as early as March. Sakurai said, "Intervention in the exchange rate only has a temporary effect on curbing yen selling pressure. The best way to deal with a weak yen is for the Bank of Japan to raise interest rates." Sakurai stated that a further depreciation of the yen would push up inflation by increasing import costs and offset some of the downward pressure from government fuel subsidies. He added that if a significant yen depreciation is needed, the Bank of Japan could raise interest rates as early as March, citing the expectation of strong wage growth from companies and unions in the spring annual wage negotiations.
